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How Do Saving Bonds Work?
How Do Appeal Bonds Work?
What Does It Mean to Be Bonded?
How to Make Money Buying Bonds
Opening a Stocks & Bonds Investment Account
How to Invest in Bonds & Stocks in a Bear Market
What Is the Difference Between Stocks & Bonds?
How Much Does a Municipal Bond Cost?
Can I Get a Surety Bond With Bad Credit?
Types of Surety Bonds
How Does a Surety Bond Work?
What Is a Surety Bond?
How Much Does a Surety Bond Cost?
What Is a Corporate Bond?
About US Treasury Bond Funds
How to Find Out When Savings Bonds Can Be Cashed
What Do You Need to Cash in Savings Bonds?
How to Cash a Savings Bond at a Local Bank
About US Savings Bonds
Principal Strip Bond Definition
What Is the Definition of an In Bond?
How to Buy Government Bonds
How to Buy Series I Bonds
How Much Is My Savings Bond Worth Today?
How to Buy High Yield Corporate Bonds
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Summary: When buying a U.S. government bond, it's advantageous to buy a variety of them through a mutual fund. Learn about the positive tax implications of buying bonds directly with help from a personal asset manager in this free video on the bond market and money management.
Roger Groh is the founder of Groh Asset Management. He manages portfolios for many types of customers, including customers seeking growth, income, stability or international customers.read more
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"I'm Roger Groh with Groh Asset Management. We're here to talk about today about buying U.S. government bonds, but buying a variety of them through a mutual fund. Remember, a mutual fund is where you own a little bit of a lot of different type of, in this case, U.S. treasury bonds. The advantage might be that you get a broad spread in terms of when those bonds mature, and just in case, you own a lot in case there are problems with any of them. I don't think that there will be, but it's always possible that that would occur. Last, there may be some positive tax implications for you to buy bonds through a mutual fund as opposed to a buying the bonds directly, the biggest of which is, the mutual fund may very well use leverage in order to increase the yield to you. Now, how you going to do that? Or how you going to determine the right bond to buy? Well, to buy a fund, you're going to have to go through your local bank or brokerage firm, or discount brokerage firm, and discuss their products that they offer with the person in charge of selling that product. It does make a big difference which one you buy, so be very specific. One note: in today's environment with interest rates at zero, bonds do very well when interest rates are going down, but they're at zero, so they're not going to go down anymore! The only way that they're going to go is up. When they go up, bonds probably will not do well in terms of performance. As a result, if I'm buying bonds today, I'm buying them short, meaning maturing in months or a year, maybe, but not thirty years. If you own a thirty year bond, rates go up, you're going to get your head handed to you. So, I'm Roger Groh. That's a little bit about buying bonds using mutual funds, and thank you for spending a few minutes with me."
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